Andrew Hallam of Millionaire Teacher fame this morning have a piece on a seminar that he gave to expatriate teachers in Singapore American Schools telling them they can thrash Managed Unit Trusts or Mutual Funds with buying just 3 Index ETFs:

The indexed portfolio was split into thirds:

• 33% in Vanguard’s U.S. total stock market index
• 33% in Vanguard’s international stock market index
• 33% in Vanguard’s total bond market index

I rebalanced the portfolio once a year, taking roughly 10 minutes out of my day.  Every other year, I increased the bond market component as my hypothetical investor grew older (bonds currently represent 38% of the total portfolio).

The returns since then, through one large bear market and its subsequent rebound looks great. What Andrew did should have followed what the American Retirement Fund do but how come his performance is better?

My guess is that it is ...